FTX founder Sam Bankman-Fried denies stealing funds from failed crypto exchange

Former FTX chief executive Sam Bankman-Fried departs from his court hearing at a federal court in New York City's Manhattan district on January 3, 2023. (REUTERS)
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Updated 13 January 2023

FTX founder Sam Bankman-Fried denies stealing funds from failed crypto exchange

  • Bankman-Fried blamed collapse of FTX exchange on a broad crash in cryptocurrency markets
  • FTX valued a year ago at $32 bln, but over $8 billion in FTX customer funds missing


NEW YORK: Sam Bankman-Fried said he did not steal money and blamed the collapse of his now-bankrupt FTX exchange on a broad crash in cryptocurrency markets, in a highly unusual blog post on Thursday, a month after his arrest on US fraud charges.
Federal prosecutors in Manhattan in December said Bankman-Fried stole billions of dollars from FTX customers to pay debts for his crypto-focused hedge fund, Alameda Research, purchase lavish real estate, and donate to US political campaigns.
He has pleaded not guilty. The Substack blog post — a rare public statement by a US criminal defendant — amounts to a preview of the defense case Bankman-Fried may present when his trial begins on Oct. 2.
“I didn’t steal funds, and I certainly didn’t stash billions away,” Bankman-Fried wrote.
Defense lawyers typically advise clients to stay silent before trial because prosecutors may use their comments against them in court.
A spokesman for Bankman-Fried declined to comment. A spokesman for the US Attorney’s office in Manhattan declined to comment.
In the post, Bankman-Fried did not directly address many of the other charges brought against him by federal prosecutors in Manhattan last month, namely that he misled investors and lenders about the financial conditions of FTX and Alameda. He wrote that he had “a lot more to say.”
The 30-year-old onetime billionaire wrote that Alameda failed to hedge against an “extreme” crash in the crypto markets, which ultimately came to pass last year.
“As Alameda became illiquid, FTX International did as well, because Alameda had a margin position open on FTX,” Bankman-Fried wrote.
Last month, two of his closest associates pleaded guilty to defrauding the trading platform’s customers and agreed to cooperate with prosecutors’ investigation.
Caroline Ellison, Alameda’s former chief executive, said in her plea hearing that Bankman-Fried and other FTX executives received billions of dollars in secret loans from Alameda.
Bankman-Fried was released on a $250 million bond in December and put under house arrest at his parents’ Palo Alto, California home, which was pledged as collateral for his return to court.
$5 billion recovered
In the post, Bankman-Fried also said FTX’s US wing is “fully solvent” and that its international unit has many billions of dollars in assets.
“If it were to reboot I believe there is a real chance that customers could be made substantially whole,” he wrote.
The comments came after a lawyer for FTX on Wednesday told a federal bankruptcy court in Delaware that the exchange had located more than $5 billion in liquid assets, and that the company plans to sell nonstrategic investments that had a book value of $4.6 billion.
That does not include assets seized by the Securities Commission of the Bahamas, where FTX was based and where Bankman-Fried lived before he was extradited to the United States. Bahamian authorities say they have seized $3.5 billion, but FTX says those funds are worth as little as $170 million.
On Wednesday night, Bankman-Fried replied on Twitter to a user named @wassielawyer who said a sale of the FTX exchange was viable. “yup my sense is that is and always has been the best recovery scenario for customers,” wrote Bankman-Fried.
FTX declared bankruptcy on Nov. 11, the same day Bankman-Fried stepped down as its chief executive.

Egyptian state-run infrastructure firm to establish Saudi branch 

Updated 19 sec ago

Egyptian state-run infrastructure firm to establish Saudi branch 

RIYADH: Egypt’s Holding Co. for Roads, Bridges, and Land Transportation Projects is planning to establish a branch of its headquarters in Saudi Arabia after securing contracts for infrastructure projects in the Kingdom. 

The decision to set up the Saudi branch was approved by Egyptian Transportation Minister Kamel Al-Wazir during the company’s general assembly meeting held on Tuesday. 

Al-Wazir, in a statement to the cabinet, emphasized the company’s expansion plans and its interest in exploring business opportunities, particularly in African and Arab countries.  

He also expressed interest in broadening the scope of the holding company beyond its primary focus. 

“There is a need to expand into activities other than roads and bridges, such as the establishment of concrete sleepers’ factories,” added Al-Wazir in the cabinet note.

Saudi Arabia aims to be among top 10 countries in logistics: transport minister 

Updated 10 min 54 sec ago

Saudi Arabia aims to be among top 10 countries in logistics: transport minister 

RIYADH: Saudi Arabia aims to be among the top 10 countries in logistics services, said Transport Minister Saleh bin Nasser Al-Jasser on Wednesday at the fourth Extraordinary Congress of the Universal Postal Union.

Dubai launches family-business support program  

Updated 19 min 3 sec ago

Dubai launches family-business support program  

RIYADH: Dubai has introduced an initiative aimed at empowering the next generation of leaders in family-owned businesses, a vital component of the UAE’s local economy. The announcement was made by Sheikh Maktoum bin Mohammed, first deputy ruler of Dubai, deputy prime minister and minister of finance of the UAE, on Tuesday.  

The Dubai Family Business Management Program is designed to empower the future leaders within family businesses, ensuring their sustained success and effective navigation through generational transitions. 

Emphasizing the program’s goals, Sheikh Maktoum said: “As part of the Dubai Centre for Family Businesses activities and in partnership with Mohammed Bin Rashid Center for Leadership Development, we launched the Dubai Family Business Management Program.” 

He added that the move aims to empower the second tier of leaders in family businesses to ensure their continuity, smooth succession of ownership and management, and strengthen their global presence.    

On the X platform, formerly Twitter, he further emphasized the integral role of family businesses in Dubai’s economic success. He expressed that by empowering them, the country strives to achieve the goals outlined in Dubai’s economic agenda D33, positioning Dubai among the world’s top economic cities. 

Egypt, Maersk’s C2X sign $3bn agreement to produce green fuel in Suez Canal  

Updated 44 min 6 sec ago

Egypt, Maersk’s C2X sign $3bn agreement to produce green fuel in Suez Canal  

RIYADH: Egypt is poised to produce green fuel through its recent agreement with Maersk’s C2X worth up to $3 billion signed on Wednesday, according to its prime minister’s office.  

The deal, signed during a meeting between Egyptian Prime Minister Mostafa Madbouly and C2X CEO Brian Davis, is aimed at producing green fuel for ship supplies and achieving zero carbon emissions. 

The agreement was formalized during a signing ceremony involving the General Authority for the Suez Canal Economic Zone, the Sovereign Fund of Egypt, the New and Renewable Energy Authority, the Egyptian Electricity Transmission Co., and the C2X company. 

Egyptian AI startup Intella raises $3.4m from Saudi investors 

Updated 04 October 2023

Egyptian AI startup Intella raises $3.4m from Saudi investors 

RIYADH: In a significant development for Saudi Arabia’s technology sector, Egyptian deep tech firm Intella has successfully secured $3.4 million in a pre-series A funding round. This funding round was led by Saudi-based HALA Ventures and Wa’ed Ventures, the venture arm of Aramco. 

The capital injection is set to accelerate Intella’s foray into the Saudi market and underpin the development of artificial intelligence models tailored for the Middle East and North Africa audience.    

To demonstrate its commitment to the market, Intella is strategically relocating its headquarters to Saudi Arabia, positioning itself in the midst of the Kingdom's growing tech and AI landscape. 

“Saudi Arabia is quickly becoming a hub for technological advances. This move fits perfectly with our plans for expansion,” said Nour Taher, CEO and co-founder.   

In its pursuit of technological excellence, Intella’s Voice system achieved a 95.73 percent accuracy rate after extensive testing involving 30,000 hours of Arabic audio. This accuracy rate surpasses industry giants like Google and IBM Watson. 

Omar Mansour, Intella’s co-founder and chief technology officer, highlighted the Arabic-focused voice technology, emphasizing its move into advanced audio analytics.   

Hailing Intella’s pioneering approach, Ali Abussaud of HALA Ventures noted: “We’re excited to back Intella’s vision. They’re making significant strides in connecting global AI progress with the needs of the Arab-speaking community, and it’s exactly the kind of initiative the region needs right now.”   

As Intella aims to lead the way in Arabic voice technology, this funding brings it closer to its goal of aligning the MENA region with global tech advancements. 

The funding round also received contributions from Sanabil500, INSEAD’s alumni angel network, and several other prominent investors.